Sands v. Manistee River Improvement Company

The plaintiff below is a corporation organized under a statute of Michigan, for the improvement of Manistee river, a stream wholly within that state. The present action was brought to collect from the defendant the amount of tolls levied for the use, in the years 1878, 1879, 1880, and 1881, of the river as improved. The improvements consisted in the removal of obstacles to the floating of logs and lumber down the stream, principally by cutting new channels at different points, and by confining the waters at the other points by embankments. The statute under which the plaintiff below was organized contains various provisions to secure a careful consideration of the improvements proposed, of their alleged benefits to the public, and, if adopted, of their proper construction, and of the tolls to be charged for their use. The company must first obtain the assent of the governor and of the attorney general to the proposed improvements, and then submit to the board of control designated a map of the sections of the stream which it proposes to improve, and plans showing the nature and character of the improvements. If, in the opinion of the board, the construction of the proposed improvements will be a public benefit, and the company is a proper one to make them, the board is required to indorse its approval upon the map and plans, give the consent of the state to their construction, and fix the time for their completion. Upon such approval, the corporation is authorized to make the improvements; and, whenever they have been completed to the satisfaction of the board of control, and accepted, that body is to fix the rates of toll which the company may charge for running vessels, boats, rafts, timber, logs, or lumber through the improved stream. These rates are to be graduated with reference to the distance run upon the river, and are not to be increased or changed without the consent of the board, and cannot be increased at any time so that they will amount to more than 15 per cent. of the cost of the improvements after deducting necessary expenses and repairs. The collection of tolls is to be confined strictly to that part of the river improved, and to the floatable material benefited by the improvements. The streams improved under the statute are to be open to all persons for the passage of vessels, boats, logs, rafts, timber, and lumber, upon payment of the prescribed tolls; and uniform rates are to be charged.

The declaration alleges a compliance by the plaintiff below with the requirements of the statute in its incorporation; in obtaining the consent of the governor and of the attorney general of the state to its proposed improvement of Manistee river; in submitting to the board of control the maps and plans of the improvements; in obtaining its opinion that their construction, as thus shown, would be a public benefit; that the plaintiff was a proper company to make the improvements; and also its consent to the same on behalf of the state, and its designation of the time within which they were to be constructed. The declaration also sets forth that the improvements were made pursuant to the plans and within the time required, with such changes and exceptions as were authorized by the board under the statute; and that when they were completed and accepted, that body fixed the rates of toll for the use of the river as improved, in running logs and timber for the years 1879 to 1881, inclusive, those rates varying from five to fifteen cents per thousand feet, board measure, according to the distance that the logs were to run through different sections of the improved stream; that, during the years mentioned, the defendant below floated down the river, through the portions improved, 78,711,000 feet of logs, board measure, and became liable for the tolls fixed upon them, amounting to $9,253, to recover which the present action was brought.

The defendant pleaded the general issue, and gave notice of several special defenses. On the trial the plaintiff established the matters alleged by him in the declaration, but the evidence offered by the defendant only tended to show that the measurement of the logs was excessive, and that the tolls receivable were less by 10 per cent. than the amount claimed. The defendant, however, contended, and requested the court to instruct the jury, in substance as follows: First. That the statute of the state, under which the plaintiff was organized and the tolls were fixed, is in conflict with the clause of the fourteenth amendment to the constitution of the United States, which declares that no state shall deprive any person of life, liberty, or property without due process of law, in authorizing the board of control to fix the rates of toll without notice to the parties interested, or affording them any opportunity of contesting the validity or propriety of such tolls, either in the first instance or afterwards. Second. That the statute in authorizing the improvements of rivers and the collection of tolls for them is in conflict with the clause of the constitution of the United States which declares that no state shall pass any law impairing the obligation of contracts, in that it impairs the contract contained in the ordinance of 1787, 'for the government of the territory of the United States north-west of the river Ohio,' giving to the people of that territory the right to the free use of the navigable waters leading into the St. Lawrence, without any tax, impost, or duty therefor. The fourth article of that ordinance declares that 'the navigable waters leading into the Mississippi and Saint Lawrence, and the carrying places between the same, shall be common highways, and forever free, as well to the inhabitants of the said territory as to the citizens of the United States, and those of any other states that may be admitted into the confederacy, without any tax, impost, or duty therefor.' But the court refused to give these instructions, or either of them; and the defendant excepted. The jury found a verdict for the plaintiff for $8,731.88, upon which judgment was entered. On appeal, the judgment was affirmed by the supreme court of the state, (53 Mich. 593, 19 N. W. Rep. 199,) and the case is brought here on writ of error.

M. J. Smiley, for plaintiff in error.

T. J. Ramsdell, for defendant in error.

Mr. Justice FIELD, after stating the case, delivered the opinion of the court, as follows: